P3.8-B MRT deal awarded without public bidding

MANILA, Philippines – Citing an emergency, the Department of Transportation and Communications (DOTC) has awarded without public bidding a P3.81-billion long-term maintenance contract for the Metro Rail Transit Line 3 (MRT-3) to a Korean-Filipino group.

The joint venture of Busan Transportation Corp., Edison Development & Construction, Tramat Mercantile Inc., TMICorp. Inc. and Castan Corp. won the deal by negotiated procurement.

A DOTC statement said the contract aims to improve the services of the glitch-prone MRT-3, which spans the North Avenue station in Quezon City to Taft Avenue in Pasay City.

“Beginning Jan. 5 next year, the winning concessionaire will fulfill the general maintenance requirements for three years,” the DOTC said in a statement on Christmas Eve.

Former MRT general manager Al Vitangcol faces trial for graft for awarding the previous maintenance contract, also without public bidding, to a group that included his uncle-in-law and a fund-raiser of the ruling Liberal Party (LP). The company, which was newly organized and had less than P1 million in capitalization, replaced Japanese giant Sumitomo.

The contract, signed by Transport Secretary and LP president Joseph Emilio Abaya, was worth $1.15 million a month. It was extended several times, lasting 10 months.

Abaya, who replaced Mar Roxas as DOTC chief, said he was just two days into the job when he signed the deal. Abaya was spared from indictment by the Office of the Ombudsman.

It is not clear why, despite the large amount involved, the indictment was for graft instead of the serious and non-bailable offense of plunder.

Under the new contract awarded this Christmas season, the DOTC stated that the service provider will procure the spare parts needed to increase the number of operating trains, especially during peak hours.

The contract also covers the general overhaul of the trains and replacement of the signaling system.

Explaining the negotiated mode of procurement, the DOTC stated that it conducted the bidding for the long-term maintenance contract twice in the past, with the first held in September 2014 and the second in January of this year, but both resulted in failure due to the non-participation of bidders.

Critics have alleged that bidding rules were designed for failure to do away with publid bidding and pave the way for negotiated procurement.

The DOTC said the Government Procurement Policy Board unanimously approved the decision to proceed with the negotiated procurement pursuant to Republic Act 9184.

It added that the move was also approved by the Department of Justice and the National Economic and Development Authority, which is chaired by President Aquino.

Explaining the nature of the “emergency,” the DOTC cited an urgent need to address the railway’s maintenance requirements and “core problems of obsolescence and complete wear-and-tear.”

Meanwhile, the DOTC said the second new light rail vehicle (LRV) for the MRT-3 arrived yesterday as scheduled at the Manila International Container Terminal.

After being processed by the Bureau of Customs, the LRV will be transported to the MRT-3 depot and tests on the different components will be conducted until February.

The tests will cover the German-made traction motors from Voith and brake systems from Knorr-Bremse, as well as overall performance of the LRV to ensure it is safe, reliable and at par with international standards, the DOTC said.

Two more LRVs for the MRT-3 are expected to be delivered over the next two months.

The delivery of the additional LRVs is expected to lead to one new running train by the end of the first quarter of next year.

The delivery of all 48 LRVs is targeted to be completed by January 2017.

The acquisition of new LRVs is part of the MRT-3 capacity expansion project.railway system and beef up its capacity to over 800,000 passengers per day.

“The DOTC project implementation team has been closely monitoring the production process to ensure the rapid progress and proper manufacture of the new trains,” the agency said.

Other improvement works are also being implemented at the MRT-3 to provide better service to riders.

In particular, new and stronger passenger hand straps have been installed for increased safety.

The refurbishment of 12 Schindler-brand escalators is also in the works and is seen to be completed by next week to provide some relief to commuters, especially senior citizens, persons with disabilities and pregnant women.